How Much Money Do You Need To Live Comfortably In Retirement?
How much you need to retire comfortably in the 10 biggest US cities
- You'll need an average of $2.8 million to retire as a homeowner in the 10 largest cities in the US.
- That's according to GoBankingRates data, and Census data on the 10 largest US cities.
- Insider calculated totals using the 4% rule (which multiplies annual costs by 25).
- Read more Personal Finance Insider coverage »
Where you plan to live in retirement will have a big impact on how much you need to save in order to live comfortably.
New data from GoBankingRates shows how much income is needed to live comfortably in 50 large US cities. How much you need to live for a year varies widely across the US.
And that means that the amount you'll need to retire comfortably varies, too.
Insider used the data to calculate how much would be needed for retirement in each of these cities using the 4% rule, assuming a retiree will spend the same amount in retirement as during their working life.
The 4% rule is a favorite of financial planners: It helps estimates how much someone would need to save for retirement based on annual income needs. Insider multiplied the annual income needs of each city by 25 to find the total needed in each of the 10 cities. The 10 cities were chosen based on Census data, and ranked based on the cost to retire as a homeowner.
On average, people in the 10 largest US cities would need to have $2.8 million saved and invested to retire comfortably as homeowners. However, it's possible to cut costs in retirement, meaning you don't necessarily need as much to live on. And, living costs can be lower outside of larger cities, which could make for a more affordable retirement.
In the 10 biggest cities, here's how it all breaks down.
10. San Antonio, Texas
The most affordable of the large cities is San Antonio, Texas — however, it's cheaper to retire as a homeowner here than a renter.
Annual income you'd need to live comfortably as a homeowner: $71,943
Retirement savings you'd need to live comfortably as a homeowner: $1,798,575
Annual income you'd need to live comfortably as a renter: $77,871
Retirement savings you'd need to live comfortably as a renter: $1,946,775
9. Houston, Texas
Houston is another relatively large and affordable city in Texas.
Annual income you'd need to live comfortably as a homeowner: $79,378
Retirement savings you'd need to live comfortably as a homeowner: $1,984,450
Annual income you'd need to live comfortably as a renter: $87,658
Retirement savings you'd need to live comfortably as a renter: $2,191,450
8. Philadelphia, Pennsylvania
Philadelphia offers a vibrant urban life without the high costs of other comparably-sized cities.
Annual income you'd need to live comfortably as a homeowner: $82,439
Retirement savings you'd need to live comfortably as a homeowner: $2,060,975
Annual income you'd need to live comfortably as a renter: $92,639
Retirement savings you'd need to live comfortably as a renter: $2,315,975
7. Dallas, Texas
Life is relatively affordable in Dallas compared to other big cities.
Annual income you'd need to live comfortably as a homeowner: $83,140
Retirement savings you'd need to live comfortably as a homeowner: $2,078,500
Annual income you'd need to live comfortably as a renter: $87,964
Retirement savings you'd need to live comfortably as a renter: $2,199,100
6. Chicago, Illinois
In Chicago, it's cheaper to retire as a homeowner than a renter.
Annual income you'd need to live comfortably as a homeowner: $84,765
Retirement savings you'd need to live comfortably as a homeowner: $2,119,125
Annual income you'd need to live comfortably as a renter: $94,917
Retirement savings you'd need to live comfortably as a renter: $2,372,925
5. Phoenix, Arizona
Retiring in Phoenix can be costly, but it might be right for some.
Annual income you'd need to live comfortably as a homeowner: $86,407
Retirement savings you'd need to live comfortably as a homeowner: $2,160,175
Annual income you'd need to live comfortably as a renter: $86,143
Retirement savings you'd need to live comfortably as a renter: $2,153,575
4. San Diego, California
San Diego can be an expensive place to retire, with the typical annual income needed in the six-figure range, and the total to retire over $3.4 million.
Annual income you'd need to live comfortably as a homeowner: $137,826
Retirement savings you'd need to live comfortably as a homeowner: $3,445,650
Annual income you'd need to live comfortably as a renter:$120,786
Retirement savings you'd need to live comfortably as a renter: $3,019,650
3. New York City, New York
New York can be an expensive place to live — you'll need about $3.2 million saved up to retire there as a renter.
Annual income you'd need to live comfortably as a homeowner: $148,448 per year
Retirement savings you'd need to live comfortably as a homeowner: $3,711,200
Annual income you'd need to live comfortably as a renter: $128,552
Retirement savings you'd need to live comfortably as a renter: $3,213,800
2. Los Angeles, California
You'll need a little bit over $3.7 million to retire comfortably in Los Angeles and own your home.
Annual income you'd need to live comfortably as a homeowner: $150,392
Retirement savings you'd need to live comfortably as a homeowner: $3,759,800
Annual income you'd need to live comfortably as a renter: $136,208
Retirement savings you'd need to live comfortably as a renter: $3,405,200
1. San Jose, California
San Jose has the highest living costs in the country, and consequently the highest retirement costs — you'd need close to $5 million to retire there as a homeowner.
Annual income you'd need to live comfortably as a homeowner:$197,502
Retirement savings you'd need to live comfortably as a homeowner: $4,937,550
Annual income you'd need to live comfortably as a renter: $143,670
Retirement savings you'd need to live comfortably as a renter:$3,591,750
Liz Knueven
Personal Finance Reporter
Liz was a reporter at Insider, primarily covering personal-finance topics. Before joining Insider, she wrote about financial and automotive topics as a freelancer for brands like LendingTree and Credit Karma. She earned her bachelor's degree in writing from The Savannah College of Art and Design. She lives and works in Cincinnati, Ohio. Find her on Twitter at @lizknueven.
Disclosure: This post may highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team. Read our editorial standards.
For you
How Much Money Do You Need To Live Comfortably In Retirement?
Source: https://www.businessinsider.com/personal-finance/how-much-to-retire-comfortably-in-biggest-cities-2021-8
Posted by: tilleryafterand.blogspot.com
0 Response to "How Much Money Do You Need To Live Comfortably In Retirement?"
Post a Comment